Final Results of Expedited Sunset Review: Barium Chloride From the People's Republic of China (PRC)

DEPARTMENT OF COMMERCE

International Trade Administration

[A-570-007]

Final Results of Expedited Sunset Review: Barium Chloride From

the People's Republic of China (PRC)

AGENCY: Import Administration, International Trade Administration, U.S.

Department of Commerce.

ACTION: Notice of final results of expedited sunset review: Barium

Chloride from the People's Republic of China (PRC).

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SUMMARY: On October 1, 1998, the Department of Commerce (``the

Department'') initiated a sunset review of the antidumping order on

barium chloride from China (PRC) (63 FR 52683) pursuant to section

751(c) of the Tariff Act of 1930, as amended (``the Act''). On the

basis of a notice of intent to participate and a complete substantive

response filed on behalf of the domestic industry, and inadequate

response (in this case no response) from respondent interested parties,

the Department determined to conduct an expedited review. As a result

of this review, the Department finds that revocation of the antidumping

order would be likely to lead to continuation or recurrence of dumping

at the levels indicated in the Final Results of Review section to this

notice.

FOR FURTHER INFORMATION CONTACT: Martha V. Douthit or Melissa G.

Skinner, Office of Policy for Import Administration, International

Trade Administration, U.S. Department of Commerce, 14th St. &

Constitution Ave., NW., Washington, D.C. 20230; telephone (202) 482-

3207 or (202) 482-1560, respectively.

EFFECTIVE DATE: February 4, 1999.

Statute and Regulations: This review was conducted pursuant to

sections 751(c) and 752 of the Act. The Department's procedures for the

conduct of sunset reviews are set forth in Procedures for Conducting

Five-year (``Sunset'') Reviews of Antidumping and Countervailing Duty

Orders, 63 FR 13516 (March 20, 1998) (``Sunset Regulations''). Guidance

on methodological or analytical issues relevant to the Department's

conduct of sunset reviews is set forth in the Department's Policy

Bulletin 98:3--Policies Regarding the Conduct of Five-year (``Sunset'')

Reviews of Antidumping and Countervailing Duty Orders; Policy Bulletin,

63 FR 18871 (April 16, 1998) (``Sunset Policy Bulletin'').

Scope: The merchandise covered by this order is barium chloride, a

chemical compound having the formula BaCl2 or

BaCl2 2H2O, currently classifiable under item

2827.38.00 of the Harmonized Tariff Schedules (HTS). The HTS item

number is provided for convenience and for Customs purposes. The

written descriptions remain dispositive.

This review covers all manufacturers and exporters of barium

chloride from China.

Background: On October 1, 1998, the Department initiated a sunset

review of the antidumping order on barium chloride from China (63 FR

52683) pursuant to section 751(c) of the Act. The Department received a

Notice of Intent to Participate from Chemical Products Corporation

(``CPC'') on October 15, 1998, within the deadline specified in section

351.218(d)(1)(i) of the Sunset Regulations. CPC claimed interested

party status under section 771(9)(C) of the Act, as a United States

producer of barium chloride. In its substantive response, CPC stated

that it was the petitioner in the original antidumping investigation

that led to the issuance of the antidumping duty order on barium

chloride from China.

[[Page 5634]]

Further, CPC stated that it has participated in all of the

administrative reviews that have been conducted by the Department on

barium chloride from China. On October 28, 1998, the Department

received a substantive response from CPC, within the 30-day deadline

specified in Sunset Regulations under section 351.218(d)(3)(i). We did

not receive a response from any respondent interested party. As a

result, pursuant to section 751(c)(3)(B) of the Act, and our

regulations (19 C.F.R. Sec. 351.218(e)(1)(ii)(C)(2)), we determined to

conduct an expedited review.

Determination: In accordance with section 751(c)(1) of the Act, the

Department conducted this review to determine whether revocation of the

antidumping order would be likely to lead to continuation or recurrence

of dumping. Section 752(c) of the Act provides that, in making this

determination, the Department shall consider the weighted-average

dumping margins determined in the investigation and subsequent reviews

and the volume of imports of the subject merchandise for the period

before and the period after the issuance of the antidumping finding,

and it shall provide to the International Trade Commission (``the

Commission'') the magnitude of the margin of dumping likely to prevail

if the finding is revoked.

The Department's determinations concerning continuation or

recurrence of dumping and magnitude of the margin are discussed below.

In addition, parties' comments with respect to the continuation or

recurrence of dumping and the magnitude of the margin are addressed

within the respective sections below.

Continuation or Recurrence of Dumping: Drawing on the guidance

provided in the legislative history accompanying the Uruguay Round

Agreements Act (``URAA''), specifically the Statement of Administrative

Action (``the SAA''), H.R. Doc. No. 103-316, vol. 1 (1994), the House

Report, H.R. Rep. No. 103-826, pt.1 (1994), and the Senate Report, S.

Rep. No. 103-412 (1994), the Department issued its Sunset Policy

Bulletin providing guidance on methodological and analytical issues,

including the basis for likelihood determinations. The Department

clarified that determinations of likelihood will be made on an order-

wide basis (see section II.A.3. of the Sunset Policy Bulletin).

Additionally, the Department normally will determine that revocation of

an antidumping order is likely to lead to continuation or recurrence of

dumping where (a) dumping continued at any level above de minimis after

the issuance of the order, (b) imports of the subject merchandise

ceased after the issuance of the order, or (c) dumping was eliminated

after the issuance of the order and import volumes for the subject

merchandise declined significantly (see section II.A.3. of the Sunset

Policy Bulletin).

The antidumping duty order on barium chloride from China was issued

on October 17,1984.1 Since that time, the Department has

conducted several administrative reviews.2 The antidumping

duty order remains in effect for all imports of barium chloride from

China.

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\1\ See Barium Chloride from the People's Republic of China,

Antidumping Duty Order, 49 FR 40635 (October 17, 1984).

\2\ See Barium Chloride from the People's Republic of China;

Final Results of Antidumping Duty Administrative Review, 52 FR 313

(January 5, 1987); Barium Chloride form the People's Republic of

China; Final Results of Antidumping Duty Administrative Review, 54

FR 52 (January 3, 1989); and Barium Chloride from the People's

Republic of China; Final Results of Antidumping Duty Administrative

Review, 57 FR 29467 (July 2, 1992).

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In its substantive response, CPC argued that revocation of the

antidumping duty order would result in the resumption of export

shipments of barium chloride from China on a large scale and at prices

well below fair value. CPC based its conclusion on a number of factors,

including historical experience, Chinese productive capacity, the Asian

economic crisis, and Chinese export policy. CPC argued that the

Department should determine that dumping will continue or resume on the

basis that dumping continued at levels above de minimis while the order

has been in effect and imports of the subject merchandise ceased after

the issuance of the order.

With respect to continuation of dumping after the issuance of the

order, CPC referred to the final results of administrative reviews

issued by the Department 3 and stated that historical

experience clearly demonstrates that the subject merchandise has been

dumped at margins greater than de minimis since the issuance of the

order. CPC stated that the 60.84 percent duty deposit margin currently

in effect for Sinochem (the Chinese manufacturer/exporter reviewed) was

first imposed in the final results of administrative review issued on

January 3, 1989.4 CPC suggested that, as a result of the

60.84 percent deposit rate, there was a significant decrease in exports

and ultimately a cessation of exports. CPC noted that for the October

1, 1990 through September 30, 1991, review period, the Department found

that there were no shipments. CPC supports its assertion that the order

resulted in the decrease, and ultimate cessation, of exports of barium

chloride from China with reference to import statistics.5

CPC asserts that the Department's issuance of preliminary and final

determinations of sales at less than fair value in April and August of

1984, resulted in the decrease of imports from China from 5.3 million

pounds in 1983 to 3.2 million pounds in 1984. CPC also noted that with

the 1989 issuance on a 60.84 percent duty deposit rate, imports

decreased from 1.5 million pounds in 1988 to 0.2 million pounds in

1989, and ultimately to zero by 1991.

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\3\ Id.

\4\ The review covered the period October 1, 1985 through

September 30, 1986, and set the duty deposit rates for entries on or

after the publication date of the notice.

\5\ CPC provided data collected from the U.S. Census Bureau and

published on Form IM 145 (from 1980 through 1988 the data were

reported under TSUS 417.70.00 and for 1989 through 1997 under HTSUS

287.38.0000).

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CPC acknowledged that imports reappeared in 1994, but at levels

significantly below pre-order levels. CPC argued, therefore, that the

continuation of dumping combined with the cessation of exports

demonstrates that Chinese barium chloride cannot be sold in the U.S.

market except through dumping. CPC also asserted that, in addition to

the original three Chinese factories producing barium chloride (as

identified in the ITC's report), it had obtained information that an

additional seven factories (with capacity of 73,400 MT/annum) produce

barium chloride in China. Noting that barium chloride is a commodity

chemical product with a number of industrial uses and applications, CPC

argued that as economic and industrial activity slows in China's

traditional Asian markets, the demand for barium chloride will decrease

and Chinese exports will decline. Therefore, asserts CPC, without an

antidumping order in place, the Chinese producers of barium chloride

can be expected to turn their attention to the U.S. market for their

excess production. Finally, CPC argues that, as supported by statements

of U.S. government officials, China has an aggressive export policy in

place that, with the revocation of the order, could be expected to

result in the resumption of large-scale shipments to the United States.

In conclusion, CPC stated that for each of the above discussed

reasons, without an order in place, dumping from China would likely

overwhelm CPC and eliminate the lone remaining U.S. producer of barium

chloride.

As discussed in Section II.A.3. of the Sunset Policy Bulletin, the

SAA at 890,

[[Page 5635]]

and the House Report at 63-64, ``Existence of dumping margins after the

order, or the cessation of imports after the order, is highly probative

of the likelihood of continuation or recurrence of dumping. If

companies continue to dump with the discipline of an order in place, it

is reasonable to assume that dumping would continue if the discipline

were removed. If imports cease after the order is issued, it is

reasonable to assume that the exporters could not sell in the United

States without dumping and that, to reenter the U.S. market, they would

have to resume dumping.'' Deposit rates above de minimis continue in

effect for exports of barium chloride from China. Additionally, exports

of barium chloride from China ceased between 1991 and 1993, and

although since resumed, have never reached higher than six percent of

their pre-order level. Therefore, given that dumping above de minimis

has continued over the life of the order and imports ceased at least

temporarily, and absent argument and evidence to the contrary, the

Department determines that dumping is likely to continue if the order

were revoked.

Magnitude of the Margin: In the Sunset Policy Bulletin, the

Department stated that, consistent with the SAA and House Report, the

Department will provide to the Commission the company-specific margins

from the investigation for each company because that is the only

calculated rate that reflects the behavior of exporters without the

discipline of an order. For companies not specifically investigated or

for companies that did not begin shipping until after the order was

issued, the Department normally will provide a margin based on the all

others rate from the investigation. See section II.B.1 of the Sunset

Policy Bulletin. Exceptions to this policy include the use of a more

recently calculated margin, where appropriate, and consideration of

duty absorption determinations. See sections II.B.2 and 3 of the Sunset

Policy Bulletin.

In its substantive response, CPC urged the Department to determine

that the magnitude of the margin likely to prevail if the order were

revoked is 60.84 percent, the margin determined in the final results of

the second administrative review and the current duty deposit rate. CPC

asserted that the Department has recognized that dumping margins can

increase after the issuance of an order and that a more current and

higher margin, even if based on the best information available, may

well be a more appropriate indicator of the magnitude of the margin

likely to prevail if the order were revoked. CPC argued that the

dumping margin and cash deposit rate for barium chloride from China

increased significantly after the issuance of the antidumping duty

order--from 14.5 percent to 60.84 percent. CPC stated that the 14.5

percent rate from the original investigation was never actually used as

the basis of assessing duties, as it was replaced by a rate of 7.82

percent in the first administrative review. Given that the margin of

60.84 percent has applied to all imports since October 1, 1986, CPC

argues that this is the only appropriate and realistic measure of the

magnitude of dumping.

In the Sunset Policy Bulletin, the Department stated that ``a

company may choose to increase dumping in order to maintain or increase

market share'' and that ``the Department may, in response to argument

from an interested party, provide the Commission a more recently

calculated margin for a particular company, where for that particular

company, dumping margins increased after the issuance of the order.''

(See section II.B.2 of the Sunset Policy Bulletin.) As detailed in

Final Results of Expedited Sunset Review: Stainless Steel Plate From

Sweden (63 FR 67658, December 8, 1998) the Department's intent was to

establish a policy of using the original investigation margin as a

starting point, thus providing interested parties the opportunity and

incentive to come forward with data which would support a different

estimate. In this case, CPC merely argued that the margin from the

original determination was never actually used to assess duties and

that, by the second review, the margin had increased to a level where

it remains today. The import statistics provided by CPC demonstrate

that, after steadily increasing from 1980 to 1983, imports of barium

chloride from China began decreasing with the issuance of the

preliminary and final determinations of sales at less than fair value.

We note that the margin from the original investigation served as the

duty deposit rate until January 1987, when the final results of the

first administrative review were issued. Further, the final results

(the 60.84 percent) of the administrative review covering imports from

October 1985 through September 1986, were issued in January 1989, five

years after the issuance of the order and, at a time when imports had

already decreased to less than 30 percent of the pre-investigation

level of imports. Although the statistics provided by CPC demonstrate a

slight increase in the volume of imports between 1984 and 1985, import

volumes decreased every year thereafter until 1995. Therefore, because

there was no increase in imports of barium chloride from China

corresponding to the increase in the dumping margin, we find CPC's

argument of choosing the rate from the second administrative review

(and current deposit rate) unpersuasive. Therefore, we find no reason

to deviate from our Sunset Policy Bulletin in this review. We determine

that the original margin calculated by the Department, which reflects

the behavior of exporters without the discipline of the order, is

probative of the behavior of the Chinese producers/exporters of barium

chloride. The Department will report to the Commission the company-

specific and ``all others'' rate at the levels indicated in the Final

Results of the Review section of this notice.

Final Results of Review: As a result of this review, the Department

finds that revocation of the antidumping finding would be likely to

lead to continuation or recurrence of dumping at the margins listed

below.

------------------------------------------------------------------------

Margin

Manufacturer/exporter (percent)

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China National Chemicals Import and Export Corporation (SINO-

CHEM)....................................................... 14.50

All Others................................................... 14.50

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This notice serves as the only reminder to parties subject to

administrative protective order (APO) of their responsibility

concerning the disposition of proprietary information disclosed under

APO in accordance with 19 CFR 351.305 of the Department's regulations.

Timely notification of return/destruction of APO materials or

conversion to judicial protective order is hereby requested. Failure to

comply with the regulations and the terms of an APO is a sanctionable

violation.

This five-year (``sunset'') review and notice are in accordance

with sections 751(c), 752(i)(1) of the Act.

Dated: January 29, 1999.

Richard W. Moreland,

Acting Assistant Secretary for Import Administration.

[FR Doc. 99-2673 Filed 2-3-99; 8:45 am]

BILLING CODE 3510-DS-P